The U.S. Department of Commerce announced late Monday it will impose “countervailing duties” of up to 24 per cent on Canadian softwood lumber, opening a new round in the long-running trade dispute.
The Department said it had “preliminarily determined that exporters of softwood lumber from Canada received countervailable subsidies of 3.02 per cent to 24.12 per cent.”
“As a result of today’s determination, Commerce will instruct U.S. Customs and Border Protection to collect cash deposits based on these preliminary rates,” it said.
The Department also warned that “certain companies will be subject to the retroactive collection of cash deposits.”
U.S. Secretary of Commerce Wilbur Ross said his department “determined a need to impose countervailing duties” of about $1 billion on Canadian softwood lumber entering the U.S.
Ottawa was quick to shoot back with a joint statement from Minister of Natural Resources Jim Carr and Foreign Affairs Minister Chrystia Freeland, who said they would defend Canada’s lumber industry -- “including through litigation.”
“The Government of Canada disagrees strongly with the U.S. Department of Commerce’s decision to impose an unfair and punitive duty. The accusations are baseless and unfounded,” they said.
The ministers argued that duties on softwood lumber will affect workers in both countries, and will raise the cost for American families to build or renovate homes.
“The U.S. National Association of Home Builders has calculated that a $1,000 increase in the cost of a new house would put home ownership beyond the reach of more than 150,000 American families, and jeopardize thousands of jobs in the American home construction industry,” they said.
The U.S. Department of Commerce had been expected to an announcement late Tuesday afternoon on possible action. But on Monday, President Donald Trump mentioned a “20 per cent tariff” at a small reception for conservative media at the White House.
At least two reporters in attendance tweeted the news, triggering an official statement from the Commerce Department.
Canada had reached more than a decade of softwood lumber peace with the United States, but the hard-fought agreement -- plus a one-year extension -- expired last October. The American lumber industry argues Canadian softwood is essentially subsidized because it comes from Crown land, but Canada repeatedly won past disputes in front of NAFTA and WTO panels.
Transport Minister Marc Garneau, who chairs the cabinet committee on Canada-U.S. relations, said earlier that Canada has always acted fairly -- which has been proven repeatedly in trade rulings.
"From our point of view, as we've said, in the past 20 years we've always felt that we were playing on a level playing field," Garneau told CTV’s Power Play.
